Iraq signs $270m Loan from Japan

Iraq has signed for receiving a Japanese loan worth USD270 million according to a statement from the Japanese Embassy in Iraq.

The loan is designed to improve Iraq’s financial situation and to help the country proceed with reforms, the statement by the embassy said, noting that it comes as a second tranche of a USD500 million Japanese financial assistance commitment.

The statement said falling world oil prices and spending on defence and refugee relief portfolios had largely reduced the country’s budget resources. It also pointed to earlier assessments by the International Monetary Fund (IMF) which estimated Iraq’s budget deficit for 2016 by 14.1% and public debt for the same year by 6.99% of the GDP.

In February, Japan approved a loan of about $100 million to support humanitarian, counter-terrorism and infrastructure projects in Iraq. In January, Japan agreed to lend Iraq up to 27.2 billion yen ($240 million) to rebuild damaged electricity infrastructures in areas recaptured from Islamic State militants.